First, the basics. If you still owe someone, or love someone, yes, you need life insurance.
Now, let’s dig a little deeper and look at the other reasons you may still need life insurance after 65.
1. You’re still the “Bank of You.” 63% of parents over 55 are still supporting their children and or grandchildren, according to LIMRA Secure Retirement Institute. What happens if you are no longer around to provide that support? Who will your children turn to for financial help? Friends or other family members? Life insurance can provide the funds to maintain this support.
2. You have a special-needs child. If so, you may need to arrange for continued care after you are gone. This can be done by funding a special-needs trust with life insurance to provide the resources necessary to provide the level of care needed for this child.
3. You’re “retired” but still working. What if you’re still earning money that you rely on? You’d need to replace the income, and the only way to do that is with assets at work. If you don’t have the assets, life insurance can create these assets at the time of your death. How much will you need? Use our Life Insurance Needs Calculator to find out.
4. You have a pension that dies with you. If you have a pension with no survivorship option, how do you replace that income stream for your spouse? Once again, life insurance can replace the lost pension income by creating the assets that can be turned into an income stream.
5. You have installment debt. According to LIMRA, retirees age 65-74 who still have installment debt have education debt of an average of $2,300, while 64% of their debt is comprised of vehicle loans. Many retirees still have mortgage debt. Life insurance can make sure these debts are paid off at the debtor’s death.
6. You’d like to leave a legacy. Life insurance is a very efficient tool to use for estate planning and the equalization of assets being left to heirs and for charitable planning. A small premium for life insurance can create the money at death to accomplish these goals.
These are just a few of the reasons why life insurance may be required after you retire. Talk with your agent or advisor to learn more.